Sure, just have a timer return the time elapsed since previous frame. If it is below a certain threshold, call Sleep(1 ms). It should be enough.
However, 95% CPU is still a lot. Perhaps the driver is busy-waiting for the Vsync. I'd first try getting the rid of it. Vsync is bad when developing, it introduces considerable deviation for measurements.

If it is below a certain threshold, call Sleep(1 ms). It should be enough.

This would decrease the amount of computing power available for game logic, not increase it.

Anyhow, a 95% CPU usage doesn't really mean you're using a whole lot of computing power, as the aforementioned sleep(1) would show.Are you actually short on computing power for game logic? or is this an attempt at preemptive optimization?

Unless you're doing the logic in a separate thread, the calculations should always finish before presenting a new frame, and such as such not result in any problems -- certainly not if you're still managing 65 FPS.

If it is below a certain threshold, call Sleep(1 ms). It should be enough.

This would decrease the amount of computing power available for game logic, not increase it.

No it would not. If the driver is busy looping on vsync then this effectively skips a sync. I bet that profiling will show the application spends most of the time in the drive.Moreover, if the driver is allowed to cache up to N frames and the CPU is so fast to actually always fill the buffer (very likely) the runtime will stall to allow GPU to catch up.In this case, sleep(1) would free CPU% as well with little to no noticeable difference.

In both cases, CPU% would be freed for computation - since FPS is locked at (say) 60, this would reflect in less CPU% being used.

The reason your CPU is using that much to run your game is because it has that much to run your game... open several other apps while playing your game if you want to slow your computer down... otherwise don't fret. The only time you should actually want to slow down a game, is when it is being run on a battery dependent device. Such as a phone.

Also if you're using windows task manager to get these values, look it up on msdn. The values aren't always accurate and might be reporting something different then you might think.

The reason your CPU is using that much to run your game is because it has that much to run your game... open several other apps while playing your game if you want to slow your computer down... otherwise don't fret. The only time you should actually want to slow down a game, is when it is being run on a battery dependent device. Such as a phone.

Also if you're using windows task manager to get these values, look it up on msdn. The values aren't always accurate and might be reporting something different then you might think.

My Game Engine1. Running a car racing game2. The game logic and Physics etc are running in a separate thread

My Current Problem1. Earlier the game logic was running on a separate PC and Visual rendering on a seperate one, and no issues where there, the FPS was 60 and CPU usage on visual was around 45%2. Now due to some considerations, merged the game logic and visual rendering together 3. Now when running the entire thing together, the car drives a bit jerky , appearing as if the visual is getting stuck occasionally in between, the FPS is still around 60.

I am not the experienced with profiling the code, so haven't bee able to exactly pinpoint the problem.

My Current Problem1. Earlier the game logic was running on a separate PC and Visual rendering on a seperate one, and no issues where there, the FPS was 60 and CPU usage on visual was around 45%

Like a server? or do you mean you processed logic on one core and rendering data on another? If the later, then you're doing your threading wrong. You shouldn't be splitting your subsystems into separate threads, but instead splitting your tasks up into separate threads.

2. Now due to some considerations, merged the game logic and visual rendering together

What's the problem there?

3. Now when running the entire thing together, the car drives a bit jerky , appearing as if the visual is getting stuck occasionally in between, the FPS is still around 60.

If you're still getting ~60fps, you're probably looking the wrong place. I doubt the jittering is performance based, but rather code based.